China to cut import tariffs for cars, parts
Will be brought down to 15% from 25% for most vehicles from July 1
CHINA will steeply cut import tariffs for cars and car parts, opening up greater access to the world’s largest vehicle market amid an easing of trade tensions with the US.
Import tariffs will be cut to 15 percent from 25 percent for most vehicles from July 1, the Ministry of Finance said yesterday, adding that this was part of efforts to open up China’s markets and spur development of the local auto sector. A small number of imported trucks are taxed at 20 percent currently.
Import tariffs for car parts would be cut to 6 percent from mostly around 10 percent, the ministry said in a statement.
The move would be a major boost to overseas carmakers, especially in helping premium brands such as Germany’s BMW, electric car maker Tesla and Daimler AG’s Mercedes-Benz close a price gap on local rivals.
“Benefits are huge for our business, especially Infiniti,” said a Yokohama-based executive at Nissan Motors, referring to the Japanese firm’s premium car brand.
Another executive at the firm’s Chinese joint venture said it was “great news” but that the biggest beneficiaries would likely be German luxury carmakers, which also include VW’s Porsche and Audi.
“That’s just because of the volume of imported cars they sell,” the person said, asking not to be named.
Nissan did not respond to a request for comment.
Toyota said it would adjust retail prices for imported cars that benefited from the lower tariffs to provide the Chinese with “competitive” products.
BMW said the move was a “strong signal that China would continue to open up”, while Audi said it welcomed the “further liberalisation and opening” of China’s market.
A Shanghai-based spokesperson for Ford said the US carmaker welcomed the new tariff policies, but declined to comment further.
China’s high tariff on vehicles – versus a 2.5 percent US levy – has been a key focus of President Donald Trump’s administration amid a simmering trade stand-off between Washington and Beijing.
Trump has said the 25 percent tariff amounted to “stupid trade”, while vehicle industry leaders such as Tesla’s Elon Musk have said that Chinese restrictions on foreign carmakers created a skewed playing field.
China and the US, however, made a breakthrough in trade talks after negotiations in Washington last week. – Reuters